China is considering a proposal to exempt individual investors from paying dividend taxes on Hong Kong stocks bought via Stock Connect, according to people with knowledge of the matter.
Regulators including the China Securities Regulatory Commission and the State Taxation Administration are reviewing a plan submitted by Hong Kong to waive the 20% tax on dividends from Hong Kong stocks bought via the link that connects to Shanghai and Shenzhen, the people said, asking not to be named discussing private information.
The proposal aims to avoid double taxation and align fairer arrangements for investors both in Hong Kong and China, the people added. Hong Kong has no tax on dividends
A final decision is still pending and there's no definite time line to implement, the people said.
The Hong Kong Stock Exchange (0388.HK) gapped up, rising more than 6% to HK$282 during the session, hitting a new high since November 2023.
YAL Price at posting:
$5.93 Sentiment: Buy Disclosure: Held
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